Recent genome-wide association studies have shown that genetic polymorphisms in the IL28 (interferon-lambda) gene are highly associated with viral clearance and treatment response. Furthermore variations in the inosine triphosphate pyrophosphatase (ITPA) gene have also been closely linked to ribavirin-induced anemia in other GWAS studies. We are genotyping our patient populations to further explore this genetic linkage and understand the functional relationship of these associations. To further study the role of IL28 in hepatitis C, we analyzed IL28B genotypes and histologic disease progression using paired liver biopsies. Patients from an untreated NIH cohort and the HALT-C trial were genotyped for the IL28B rs12979860 SNP using TaqMan assay. Hepatic inflammation was scored using the HAI (0-18) scale and fibrosis using the Ishak (0-6) scale. Fibrosis progression was defined as a 2-point increase in Ishak score between biopsies. Histological severity on initial biopsy and change between paired liver biopsies were correlated with IL28B genotype. Multiple logistic regression was used to identify variables associated with fibrosis progression. Liver biopsies from 1483 patients were included in the baseline and 278 in the paired analysis (median time between biopsies-4 years). At initial biopsy, patients with IL28B CC genotype had significantly higher portal inflammation (2.3 vs 2.1) and ALT levels (143 vs 100 IU/L) but lower Ishak fibrosis scores compared to those with CT/TT genotype (3.6 vs 3.8), p values <0.05 for all. In the paired biopsy analysis, fibrosis progression occurred in 22% of patients. There was no difference in the frequency of fibrosis progression between patients with IL28B genotype CC and non-CC 17% vs 23%, respectively. Similarly, mean change in HAI scores and ALT levels were not different between CC and CT/TT genotypes. In logistic regression, factors associated with fibrosis progression were higher baseline alkaline phosphatase levels and lower platelet counts. IL28B genotype was not associated with fibrosis progression in patients with CHC. The favorable IL28B CC genotype was associated with greater hepatic necroinflammation and serum ALT levels but less fibrosis progression. These results suggests that IL28B genotype CC may be associated with a state of enhanced antiviral immune response that promotes viral clearance but with a lesser likelihood of disease progression. HCV genotypes (gt) 2/3 respond to interferon (IFN) treatment better than gt 1. In gt 1, non-responder patients exhibit baseline activation of IFN-stimulated genes (ISGs) that renders them less responsive to exogenous IFN. It is not clear whether a differential activation of ISGs underlies the genotypic difference in responsiveness. We studied the hepatic expression of ISGs in patients with gt 1 or 2/3 before and after PEG-IFN injection. 26 untreated patients with chronic hepatitis C (17 with gt 1 and 9 with gt 2/3) were enrolled in a prospective trial with PEG-IFN alfa-2a and ribavirin in standard doses. 14 patients were randomized to a liver biopsy prior to starting treatment (9 with gt 1, 5 with gt 2/3) and 12 patients underwent a biopsy 6 hours after the first PEG-IFN injection (8 with gt 1, 4 with gt 2/3). Gene expression in biopsy specimens was measured using Affymetrix microarray and analyzed by ANOVA model for viral genotype. Significant gene induction was defined as 1.5 fold-change and p-value with FDR<0.05. IFN response was assessed using the 1st phase of viral decline. Overall 306 genes were affected by PEG-IFN (267 upregulated and 39 downregulated) in the study population.